The City as a Business: Gas and Business in the Spanish region of Galicia, 1850-1936

Continuity and Changehttp://journals.cambridge.org/CON

Additional services for Continuity and Change:

Email alerts: Click hereSubscriptions: Click hereCommercial reprints: Click hereTerms of use : Click here

The city as a business: gas and business in theSpanish region of Galicia, 1850–1936

ALBERTE MARTÍNEZ LÓPEZ and JESÚS MIRÁS-ARAUJO

Continuity and Change / Volume 27 / Issue 01 / May 2012, pp 125 - 150DOI: 10.1017/S0268416012000082, Published online: 11 April 2012

Link to this article: http://journals.cambridge.org/abstract_S0268416012000082

How to cite this article:ALBERTE MARTÍNEZ LÓPEZ and JESÚS MIRÁS-ARAUJO (2012). The city as abusiness: gas and business in the Spanish region of Galicia, 1850–1936.Continuity and Change, 27, pp 125-150 doi:10.1017/S0268416012000082

Request Permissions : Click here

Downloaded from http://journals.cambridge.org/CON, IP address: 193.144.58.27 on 17 Dec 2014

The city as a business : gas and businessin the Spanish region of Galicia,

1850–1936

ALBERTE MARTINEZ LOPEZ ANDJESUS MIRAS-ARAUJO*

ABSTRACT. The history of town gas is unique in the development of public services in

urban areas. Indeed, gas was the subject of the first network infrastructure set upin cities. In Spain, its history is discontinuous because the networks were dismantledin the 1940s and 1950s. The purpose of this paper is to retrace the steps of the

development of the gas network in a region where the Spanish gas companies took theform of early modern businesses. They contributed significantly to the dynamismof local financial markets, both in terms of enterprise configuration, technology

dissemination and innovative management. However, the development of the gasindustry remained subject to local conditions of supply and demand, to conflicts withlocal government and suffered from competition from electricity.

1. INTRODUCT ION

Gas represents a unique case in the field of public services. As well asbeing the first urban networked infrastructure, in the 1970s, during theenvironmental and energy crisis, it regained its status as an available en-ergy source.

The gas industry developed in Europe between the late eighteenthand the early nineteenth century.1 The first commercial applications wereimplemented in Great Britain,2 where expansion was so spectacularthat by the mid-nineteenth century the gas industry was widespread.3

Developments were slower on the continent4 (even in the most advanced

* Department of Applied Economics, University of A Coruna.

Continuity and Change 27 (1), 2012, 125–150. f Cambridge University Press 2012

doi:10.1017/S0268416012000082

125

countries such as France and Germany), although it did reach the largercities in the following decades.5

As well as other supply and demand factors, it was probably the in-creasing demand for new lighting systems that led to such rapid expan-sion. Nevertheless, there were various obstacles to the production of coalgas across the continent such as the initial technical conditions of manu-facturing gas, some over-optimistic estimates of supply costs (causingcosts to rise), distribution systems that needed significant investment andthe perception of insecurity amongst citizens.6

Consequently, in the first half of the nineteenth century, coal gas wasalmost exclusively a lighting fuel and this increased with the demand forpublic lighting and industrial consumption.7 It was not until the 1870sthat gas was used for other purposes, in commercial premises and aristo-cratic households, lighting middle-class homes between 1840 and 1870.Over the next 20 years, cooking and heating gas reached middle-classkitchens;8 however, gas was still a luxury fuel in the home, despite therapid fall in gas prices as technology improved.9

When electricity arrived in the late nineteenth century, it providedstrong competition for the gas industry; hence the gas industry con-solidated itself rather than actually grew.10 Innovations in gas-lightingtechnology still sustained the gaslight business in the late nineteenth cen-tury, but this quickly declined as electric power became available.11 Froma situation of hegemony (whereby gas had occupied the main segments ofconsumption), the sector had to redesign its strategies in search of othermarket segments that might replace the foreseeable loss of demand causedby the development of electricity.12 After the First World War, compe-tition became tougher as the electricity industry was much more powerfulthan in earlier years.13

In Spain, the gas industry followed a similar chronological pattern tothat of the rest of Europe, although there are a couple of distinctive fea-tures. First, there was a relative delay in implementing coal gas. Second,the sector has been discontinuous; since networks were dismantled in the1940s and 1950s in most regions, they thus had to be rebuilt after the1990s to distribute natural gas. Most studies on the implementation of gasin Spain are predominantly local case studies written by executives of thegas companies themselves.

The main objective of this paper is to trace the long-term evolution ofgas development in the Spanish region of Galicia.14 This is significant, as itwill allow a pattern to emerge that we can compare with other similarstudies. Galicia is representative of the development of the gas industrycompared with other Spanish and even peripheral European regions,most of which were scarcely industrialised and urbanised at that time.

ALBERTE MART I NEZ LO PEZ AND JES U S MIRA S -ARAUJO

126

Thedifference between core andperipheral regions15has been rather signifi-cant in the development of the gas industry in Europe, not only as regardstiming but also in the availability of coal, regulations, profitability, de-mand, sources of capital, business structure and strategies. More par-ticularly, we wish to analyse these issues in a specific environment that wasrepresentative of the small- and medium-sized cities in Spain. The paper isstructured chronologically, in three major stages: the era of monopoly,the arrival of electricity as a competitor and the eventual replacement byelectricity. These stages coincide with what occurred in the gas industry inthe rest of Europe although in Spain they were somewhat delayed.

This article uses basic document sources from municipal lighting files,municipal records, reports from concessionaire companies and officialstatistics.

Municipal documentation is highly useful for providing backgroundinformation, information on regulations and any conflicts between localauthorities and concessionaires. Its main drawback is the lack of docu-mentation about the economic development of the gas factories. On theother hand, due to the focus on public lighting, there is little or even noinformation on gas from the end of the nineteenth century when gas wassubstituted by electricity in street lighting.

Business sources are particularly relevant for learning about the evol-ution of the sector from the moment electricity became a competitor (asstated above). Unfortunately, we have found limited and relatively insig-nificant business documentation due to the service’s early collapse and thestrong discontinuity of (some foreign) company ownership.

Official statistics provide generic data but allow us to understand thechronology and establish comparisons.

2. GAS IN THE ERA OF MONOPOLY

The gas industry, alongside electricity, water, transportation and com-munication, has the attributes of a natural monopoly, since it is cheaper tosupply the needs of a particular area from a single company rather thanuse several suppliers.16 Moreover, the elimination of competition oftengenerates the emergence of economies of scale,17 as well as positive andnegative external effects that cannot be captured by market mechanisms.18

Nevertheless, some authors reject the idea of natural monopoly as situa-tions exist whereby there is competition between more than one supplier.19

The gas companies’ monopoly in street lighting was strategically in-troduced to attract potential private demand.20 Territorial expansion,through control of the area supplied, was the key to profitability in thisstrategy. Once the initial investment was made, the success of the gas

GAS AND BUSINESS IN THE SPANISH REGION OF GALICIA

127

industry would be assured if firms could expand their production, distri-bution and consumption. This would have implied a continued increase inprivate demand, a sector that would provide the greatest benefits andtowards which companies in European industrial cities were focused.21

The spread of gas infrastructures in the Western world suffered con-siderable failure in its infancy due to lack of capital, insecurity aboutpotential demand, dependence on the quality and quantity of coal and thegeneral lack of expertise. However, prior to 1830, innovation had spreadthroughout the major cities of Western Europe.22 Great Britain, Franceand Belgium were the pioneers in this sector, due to their technologicalleadership and availability of capital, and all of them (particularly GreatBritain) due to their abundant coal deposits. Until 1840, British techno-logical hegemony in the European gas industry was almost absolute.23

However, from that moment on, the situation tended to balance out, withincreasing French presence. France’s foreign expansion concentrated onthe Mediterranean Sea, both on the northern shores (Spain and Italy) andin its North African colonies.24

The gas industry in Spain did not begin until the 1840s and this wasrelatively late compared to other countries. This occurred during the se-cond wave of investment in the sector, which covered peripheral Europe:Central Europe, Scandinavia,25 Southern Europe26 and Eastern Europe,in that chronological order. A key element in making a gas plant viable isthe supply of coal at low costs. This was an important handicap forcountries such as Spain, which either had no coal or where the coal was ofvery poor quality and/or difficult to access easily. Hence, especially at theoutset, coastal cities, and particularly economically dynamic cities (suchas those of Catalonia),27 were the first to provide this new service. Onemust also consider the delay with the railway infrastructure that manySpanish cities had to endure.28 Expansion from large cities to smallertowns occurred, following the pattern of other developed countries.29

The example of Galicia (Fig. 1) confirms the need for a certain popu-lation threshold for profitable investment in the network, i.e. for around25,000–30,000 inhabitants, a figure which is significantly higher than inmost developed countries.30 Alongside this demographic factor, therewere others that, on the whole, were common worldwide: economicgrowth, income, characterisation of local elite and the emulation effect. Acertain degree of socio-economic development (industrialisation andgross domestic product per capita) was necessary to guarantee the prof-itability of the investment. On the other hand, the dynamism of the localbourgeoisie and authorities and their ‘envy’ of other cities (the myth ofModernity) also played a relatively important role in stimulating the newpublic service.


128

This helps us understand the sequence of the introduction of gas inGalicia. First, one notes the early adoption in A Coruna (1855),31 the maintown in Galicia. Its population was mainly concentrated in its urban area,and its citizens enjoyed higher incomes amongst a modern and cosmo-politan local elite. This represents a different model from the other

Spain

Lugo

Ourense

Pontevedra

Santiago

A Coruña

Ferrol

Vigo

Galicia

Galicia

F IGURE 1. Cities in Galicia and the location of the region in Spain.


129

Galician cities, as we will subsequently see. Second, implementation wasdelayed, albeit only in those cities with a certain industrial base such asFerrol (1883)32 and Vigo (1884),33 or those with historical importance andpolitical rivalry with A Coruna (Santiago, 1873).34 Conversely, othercountries, such as Ireland (which traditionally has been compared withGalicia), enjoyed gas street lighting very early on (in the early 1820s), dueto the British influence and its proximity to English coal.35 By the middleof the decade, the main cities in Holland (another small, developedcountry) were using gas, again (as in the Irish case) using British capital.36

Another nearby and comparable country to Galicia, Portugal, wasequipped with gas lighting in the main cities between 1848 and 1859.37

As in most countries, foreign capital played a significant role in thelaunch of the Spanish gas network, due to increased availability of capital,technology and experience in the sector. In the Spanish case, the Frenchwere the main investors, followed by the British, the two hegemonic gaspowers in Europe. In Galicia, as supply was delayed, no autochthonousentrepreneurs were involved in the development.38 The initiative camefrom a small company in Lyon,39 which was the headquarters of the mostimportant French and European gas holdings. In Galicia, this group wasinitially based in A Coruna,40 and later controlled the factories of Vigo41

and Santiago.42 On the eve of the First World War, it transferred all itsGalician industrial facilities to regional electricity companies that wereprogressively controlled by the Sociedad General Gallega de Electricidad.The other gas company in Galicia was Catalana de Gas, the leadingSpanish company in the sector, which managed the Ferrol factory.43

Finally, a small company from Asturias, Menendez Valdes y Companıa,began providing gas to Santiago de Compostela.44

From a regulatory point of view, Spain is similar to other WesternEuropean countries. Compared with the prevalence of municipal propertyand management in several European countries (Germany, Scandinaviancountries or major cities in Britain), private companies prevailed in Spain,as in Italy, France and Belgium. As there was no specific legislationto regulate gas infrastructure in Europe including Spain, the earlyfacilities were made possible through a mechanism inherited from theAncien Regime. At the start of some worldwide urban infrastructures(particularly gas) there were no legal precedents to adapt the differentfacets of a production, distribution and consumption process. Exclusiveprivileges were granted by the states and, in their name, by city councils.This allowed the first gas networks to develop in Europe in a situation ofmonopoly, as gas companies had no competition.

Later, between 1850 and 1870, privileges were replaced by concessions,which in practice were also a monopoly. The main advantage of the


130

concession was that it could safeguard the interests of the gas companies.It was an important asset for companies, for if a city did not have apowerful industrial sector, necessary expansion of the network would bedone should there be a need for increased gas production. In the oppositescenario, the concession would continue, waiting for a future consoli-dation of the industrial base.45

In France and Spain, it was councils that granted the concession ofthis public service, albeit under the supervision of the central govern-ment.46 The initial legislation was refined over time, especially regardingthe definition of quality of service and control mechanisms.47 The pursuitof exclusivity in street lighting was a key objective for the gas companies,as they needed a minimum guaranteed level of demand that wouldgive them a return on the considerable fixed infrastructure costs. Asfor private demand, the situation was more ambiguous due to thevarious legal loopholes regarding municipal competence in this area andthe interest of local authorities to regulate only what concerned themunicipal institution. Given the physical and economic impossibilityof competition in most Spanish cities, the duration of the concessionwas more relevant, because an assured market allowed better return oninvestment.48

In the concessions, the so-called ‘scientific progress clause ’ was in-cluded, which created a dilemma for the gas companies. Either they couldadopt possible future findings in the field of energies or lose the con-cession. If, because of advances in technology and science, a cheaper andmore efficient street lighting system of cities than gas was achieved, the gasentrepreneurs would have to be prepared to adopt it or lose the con-cession. However, both the privilege and the concession could be bought,sold or transferred, resulting in negative consequences for the installationof gas in many Spanish cities.49 In this aspect, A Coruna was a pioneer,because this clause was introduced in 1854, much earlier than in largercities such as Seville.

Municipal corporations provided direct benefits in Galicia, i.e. freetransfer of land required for building the gas plant and exemption frommunicipal taxes on input used in the manufacturing process. Companiesalso needed to achieve a certain level to take advantage of this, and henceinsisted on establishing a minimum mandatory number of lamps to con-tract by local councils. These numbers varied, depending not only onpopulation and the area to illuminate but also on the relative strength ofthe local government and the concessionaire company. Besides the num-ber of lamps, their operating hours also affected the total expenditure onlighting. Companies demanded that the annual hours of lighting be ashigh as possible, again with significant differences between municipalities.


131

The third variable that affected income for the companies from streetlighting was the price. The rates for the municipality were significantlylower than those for homes. In fact, it has been often stated that the com-panies operated at a loss from their main customers, especially due to therepeated delays and unpaid dues caused by the structural weakness ofmunicipal finance in Spain. For the companies, this would be a burdenin compensation for the possibilities provided by the private market. InGalician cities, the latter supported a different rate to the administration,which in relative terms, ranged from 40 per cent in Santiago to 75 per centin A Coruna. Consequently the concessionaire attempted to alleviatethe reduced tariffs imposed by the municipality of A Coruna on itsconsumption through a greater percentage surcharge upon residentialcontracts.

Concessionaire companies were interested in obtaining the exclusiveservice and beneficial fees, but also wanted to guarantee the possibilities ofmarket expansion, particularly amongst individual contracts. However, inorder for this growth to be profitable, it would have to be done with acertain ratio of the number of customers and the extension of the network.This was because the infrastructure’s high cost was passed on to con-sumers. On the other hand, municipalities and their neighbours were alsointerested in expanding the service to new places, streets and neighbour-hoods, as it was a sign of social prestige. The key element that markedthe profitability thresholds was the distance between the points of light(lanterns or consumers), so that companies sought the maximum planneddistance to expand the network as little as possible.

Friction between the municipalities of Galicia and the concessionairecompanies was visible both in the process of implementing the serviceand its subsequent management.50 Local corporations were interested incarrying out work to lay pipes with the least possible damage to thepavement and within a reasonable timeframe. The reality, however, ten-ded to be different, as the companies did not take a great deal of care overtheir work and faced problems with their contractors and surveyors ordomestic difficulties of various kinds.51

There was friction once again when the service began. First and fore-most, there were issues with quality control, seen in the fulfilment of thecontract clauses in terms of the number of light points, hours of operationand light intensity. The greatest difficulty was the measurement of thebrightness quality of light points, mainly street lighting lanterns. First, itwas difficult to establish benchmarks. The solution generally adopted wasto compare it with the previous system, that is, oil-based lighting.Moreover, at least in the early days, corporations lacked the knowledgeand the human and material resources to exert such control, being forced


132

to resort to outsourcing. They used the company’s material resources andrecruited reports from university experts. Over time, local authoritiesgradually obtained professionals and technical instruments (photometryoffices) that allowed them to obtain more objective control.

In general, contract terms were quite favourable to the companies,due to their greater negotiating experience. A Coruna in Galicia was anexception because of its greater strength. In some cases, production termscould become obsolete. Over time, these defects became more dramatic.Therefore, both parties, particularly corporations, sought renegotiationof the original agreements, a process that was not without tension.Contractual privileges and their interpretation led to various controversialsituations.52Another causeof conflict between companies and corporationswas the delays and the councils’ unpaid street lighting bills.53 It has gen-erally been said that low gas prices (as compared with previous systems)were a major explanatory factor for change. However, the empirical evi-dence of the Galician cities puts that interpretation into question, since,in all cases, the costs of lighting increased significantly at the timeof replacement, without having an appreciable increase in the number oflamps or the lighting area (see Figure 2).

The gas companies’54 main customers, the town councils, provided themwith highly stable incomes. For that reason, the municipal delays andnon-payment of debts (despite varying widely among municipalities)55

were highly inconvenient. This behaviour was not exclusive to Galicianmunicipalities and did not only affect the gas service. Municipalities did

0

10,000

20,000

30,000

40,000

50,000

60,000P

eset

as

Olive oil Paraffin and gas Gas

1861 1876 1886

F IGURE 2. Public lighting expenses in Santiago, in current pesetas (1861–1886). (Source:

Archivo Historico de la Universidad de Santiago de Compostela, Archivo Municipal.

Alumbrado publico, libros 1385–7.)


133

not have sufficient financial resources at their disposal (because of centralgovernment constraints) but at the same time they had to face citizens’new demands. However, some short- and medium-term cycles were de-tected, in which problems were more acute. Unpaid bills usually appearedin May or June, when each municipality’s current budget was almostdepleted. Debts arose in two specific situations: first, during the initialmonths of the service’s operation (due to increased spending on gas forlighting as compared with that of its predecessor) ; and second, duringthe unstable period of the Sexenio Revolucionario in Spain (1868–1874). Ingeneral, municipal arrears are positively correlated with the length ofservice, in particular due to the impact of the Sexenio Revolucionario.

3. COMPET IT ION FROM ELECTR IC POWER AND IT S COEX I S TENCE

WITH GAS, 1 8 9 0 – 1 9 1 4

Towards the end of the nineteenth century, the worldwide gas industryhad to face increasing competition from electricity.56 Developments inelectric lighting began by the 1870s. The first phase of installation of thissystem in American cities took place in the early 1880s57 and subsequently(a few years later) in Europe. It began to capture the market as supplyunderwent a rapid growth from the 1890s,58 gradually consolidating thechange of the system at the turn of the century.59

Several technical innovations then came to the aid of gas.60 Competitionfrom electricity, alongside those technical changes, favoured an increaseddiversification of uses for gas, expanding to the industrial sector and,above all, to the domestic sector, although this took time.61 From the earlytwentieth century, electricity quickly replaced the gas industry’s mainstaylighting market in the cities of developed countries,62 although gas com-panies resolved to stay in business by marketing gas for heating andcooking purposes. Despite the fact that in the first, and especially in thesecond decade of the century, costs were reduced (thanks to the adoptionof hydraulic procedures), gas began to see that its days were numbered.

In Spain, it was the start of the twentieth century when the situationdeteriorated for gas. Electricity arrived in the final years of the nineteenthcentury and proved to be (just like everywhere else in the world) fiercecompetition for gas in the lighting market.63 Whilst electricity was gen-erated by thermal procedures (coal-fired power stations), the high pro-duction costs hindered its extension.64 However, during the early yearsof the twentieth century, a promising horizon was opened up thanks to thelaunch of the first large hydropower plants and the implementation of newforms of transporting electricity. This gave rise to a widespread debate inSpanish cities on respective comparative advantages in terms of light


134

power and costs. Although the outcome was inconclusive for a long time,the balance finally tilted in favour of electricity.

The collision between gas and electricity had initially taken manyEuropean cities by surprise, initiating a struggle for energy supply,although companies which implemented the networks also considered thisan opportunity for future collaboration. In Spain, introducing electricityinto cities was not easy due to the gas companies’ resistance. However,after initial rejection, after some years, electricity was adopted by the gascompanies. Companies had a legal instrument in their favour, i.e. themonopolistic concessions they had obtained from the councils.

InGalicia, therewere several crucial projects for electric light installationongoing in the last quarter of the nineteenth century. Private lightingmainly existed in those cities where there was already a monopoly ofpublic lighting by gas. In 1901 there were 81 gas plants for lighting inSpain.65 In Galicia, there were several gas plants, supplying major cities,which in several cases led to subsequent electrical companies. This featureis partly consistent with the pattern observed in other countries, althoughin those cases mergers took place amongst once-competitive gaslight andelectric power firms, particularly in large urban areas, and especiallyduring 1880–1910.66 Gas production rose in Galicia, and in most Spanishcities, although in 1901 amounted only to 1.7 million m3.67

Regional gas companies tried to pose many obstacles to the emergenceof electricity companies,68 but they could not prevent the introductionof electricity, as shown by the timing of its implementation in Galiciancities : A Coruna in 1890, Ferrol in 1895, Lugo in 1899, Ourense in 1896,Pontevedra in 1888, Santiago in 1895 and Vigo in 1896. For instance, thecompany in A Coruna used the contract signed with the city council(which only required the adoption of technological improvements relatedto gas) to reject the use of electricity for public lighting,69 although itgradually accepted the change of system, in order to try to maintain themonopoly in street lighting. For non-monopolistic demands (privatelighting and power), new electricity companies soon began to be estab-lished.70 The gas companies then created small-scale steam and gas plantsto gain control of these markets, as occurred in A Coruna, where thecompany started supplying electricity to private customers in 1890.71

By the turn of the century, electricity had also arrived in Santiago andFerrol. In Santiago, in 1895, the Sociedad de Gas y Electricidad deSantiago was founded, becoming in 1900 the S.A. Companıa Popular deGas y Electricidad, a company that absorbed other smaller electricityfirms in the early twentieth century.72 By the turn of the century, publiclighting in the city began to be subject to several reforms. Gas lightingremained limited to the streets, and it seemed preferable to adopt


135

electricity as a general lighting system.73 In Ferrol, time was running outfor the gas service, because at the time of its installation, it was no longerperceived as a technological breakthrough. The advantages and dis-advantages of gas were well known, whereas electricity was emerging asthe future.74 Therefore, in 1893, both the company and the council agreedto cancel the public gas lighting contract due to lack of compliance of theterms by the company.75

Another drawback for gas in Galicia (indeed in Spain as a whole) wasthe expiry of supply contracts between councils and companies in largenumbers of cities. Tenders for the renovation of gas supplies were thenannounced in many Spanish cities, but were not granted, which led to theextension of prior contracts. Therefore, in general, companies and towncouncils continued to renew the contracts for gas lighting, e.g. in 1883 inSeville, whereby a new 30-year agreement was signed with the supplier.76

Conversely, in other cities, such as Castellon, the duration of the newcontract (from 1889) was fixed at 10 years.77 In 1880 in Galicia, the citycouncil of A Coruna had signed a contract extending the concessionfor 25 years.78 However, there was vigorous objection from some citycouncillors to extending the service so substantially.

A Coruna witnessed ‘feverish ’ municipal activity to obtain moreefficient regulation of public lighting during the transition between the1900s and the 1910s,79 within a double context. First, there were debates inEurope on the systems of managing public utilities. During the nineteenthcentury, European city councils had neither the technical nor financialcapacity to provide efficient public services, so private companies wereconsidered the most suitable alternative.80 Nevertheless, by the end of thecentury, the shortcomings of this sort of management model opened theway to municipalising public utilities. This opened a debate on the regu-lation of these services that lasted for the first two decades into the 1900s,81

although its specificity in the field of regulation was characterised by sig-nificant differences at international level.82

Second, the new ideological background of the regeneration movementin Spain (1898 onwards) had an outstanding influence, being optimisticthat Spanish town councils could manage the operation of certainservices.83 Somewhat later, there were isolated attempts of some localauthorities (especially the largest and most dynamic cities, but notGalician towns)84 to take charge of these services and gain control of thegas supply.85

The situation was more simplistic in other Galician cities. In Santiago,only very specific plots of energy supply could be retained.86 Theincreasing demand led to a continued expansion of supply, but itconcentrated exclusively on electricity, both for public and private use,


136

cornering the gas in street lighting and in certain uses by individualcustomers, but not without retaining its monopoly.87

Implementation arrived very late (i.e. in 1896) in Vigo. During the earlyyears of the twentieth century, the two systems coexisted without signifi-cant hostility. However, there was a gradually increasing awareness of theneed for supremacy.88 Urban and industrial growth and the start of thetram network (amongst other factors) caused a significant expansion ofenergy demand, which predominantly opted for electricity.89 In addition,a sense of urgency was felt by a number of councillors, who were awareof the accumulated delay in the adoption of gas, and were unwilling to letthe opportunity pass by once again. In fact, a mere 12 years after theinstallation of gas lighting, the very company that supplied the gas set upthe necessary machinery for the production of electricity.90 The transitionfrom gas to electricity was neither sudden nor traumatic, but took placegradually, beginning with certain streets, while public buildings continuedto be lit with gas. However, the deterioration of the old gas facilities wasalso an excellent opportunity that facilitated technological change. Streetlighting by gas disappeared completely in 1936.

4. THE GRADUAL SH IFT TOWARDS ELECTR IC ITY, 1 9 1 4 – 1 9 3 6

Before the First World War, electricity had not yet managed to replacegas. However, the war had a very damaging impact on the gas industryboth in Europe as a whole and in Spain, as a result of the dismantlingof the Atlantic shipping routes and the difficulty of transporting coal.91

In Spain, the price of gas was higher than that of electricity, but thiscircumstance worsened during the conflict, and this caused the gasindustry (which was dedicated to lighting, especially public lighting) toundergo a very steep decline.92 Instead, the option of hydroelectric stationsunderwent an extraordinary thrust as a consequence of the expansion ofthe Spanish economy. This was derived from neutrality during the warand the aforementioned difficulties in coal supply. Electricity companiesseized the opportunity, moving to the fore in the energy market.93

At the beginning of the First World War, there were two gas plants inthe province of A Coruna, one in the provincial capital and the otherin Santiago. The number of factories was reduced, as opposed to whatwas happening in other cities in Spain such as Barcelona (the latter hadthe largest number of plants in Spain, 18).94 As a result of the war, theSantiago plant had to be shut down, as did other installations such as inCastellon (1919),95 Puerto de Santa Marıa (1920) or Cadiz (1918), whoseservice was relaunched in 1921, on a date that was shortly after its sale tothe City Council.96


137

Coruna’s plant’s production suffered a severe blow, just like in otherSpanish cities, from which it slowly recovered during the following years(see Figure 3).97 In 1915, the annual production of the two factories in theprovince and the one in Vigo was much lower than at the beginning of thecentury.98 This was also common in other Spanish plants, which reducedtheir emissions or were obliged to terminate the service.99 The reasonswere shortages, difficulties of importation and the increasing prices of theinputs and raw materials (especially coal).100

To tackle competition from electricity, gas was used in diverse ways,although its growth slowed down for various reasons until the civil war(1936). The most serious problem was the provision of coal, since thequality of gas and light was linked to raw materials. In addition, freightcharges during the First World War remained very high, and fluctuateddrastically (see Figure 4).101 Consumption underwent a sharp decline, dueto the high price of gas and its deficient quality. Even so, existing demandwas enough to ensure the employment and the production (most of thetime) for two of the seven furnaces that the Coruna plant operated duringthose years.102

The inter-war period was significant for gas. At international level,the industry continued to expand, although at a slower pace than

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

1901

1903

1905

1908

1910

1912

1915

1917

1920

–21

1925

–26

1928

1930

1932

1934

1936

1938

Pro

duct

ion

in c

ubic

met

res

Annual production of gas A Coruña Annual production of gas Vigo

F IGURE 3. Annual production of gas in A Coruna and Vigo, in m3 (1901–1938). (Source:

Direccion General de Contribuciones, Estadıstica del impuesto sobre el consumo de luz de gas,

electricidad y carburo de calcio, Madrid; and Ministerio de Industria, Estadıstica minera y

metalurgica de Espana, years 1927–1938.)


138

electricity.103 The end of the First World War obliged companies to againrevise their strategic policies. Competition became more severe in manycountries, given that the electricity industry was much more powerful,achieving a favourable position in terms of costs, especially as there hadnot been any outstanding technological innovations in the gas industry.104

In Spain, we notice a diverging trend in the prices of electricity and gas forlighting since the war, due to the slight decrease of the former and theincrease of the latter (see Figure 5).

The 1920s were a turning point in Spain’s recent history of energy,because, during that decade, electricity finally came of age and electricitycould be transported over long distances at relatively low costs. Thus,hydroelectric power could reach the major urban and industrial centres inconditions with which gas could not compete.105 As a result, the Spanishgas industry was in a seriously inferior position to tackle competitionfrom electricity, although domestic coal began to drop its prices106 in orderto avoid being supplanted by British coal (at that time, coal reached theSpanish market at similar prices despite the difference in freight chargesand tariffs) (see Figure 4). Consequently, the 1920s witnessed a gradualflagging of gas prices, not because of the business results but because of

0

50

100

150

200

250

1890

1892

1894

1896

1898

1900

1902

1904

1906

1908

1910

1912

1914

1916

1918

1920

1922

1924

1926

1928

1930

1932

1934

Pric

es in

pes

etas

per

tonn

e

Price of coal imported (1) Average price of Spanish coal (2)

F IGURE 4. Coal prices in Spain, 1890–1935, in pesetas/tonne. Note (1): average price of

coal imported on the Spanish coastline, 1870–1925, in pesetas/tonne. Note (2): average price

of coal of Spanish origin, including coal, anthracite and lignite, 1877–1935, in pesetas/tonne.

(Source: S. Coll and C. Sudria, El carbon en Espana 1770–1961. Una historia economica,

Madrid, 1987, 432, 435–38.)


139

the less significant weight of gas in the production structure of the energycompanies.

Although the First World War did not cause a substantial improvementfor the Spanish gas industry, the Coruna plant regained its lost rhythm(Figure 6), with production figures reaching considerably higher levelsthan those during the conflict.107 The company’s strategy to diversify useswas fruitful, as seen by the expansion of private consumption. In addition,the lowering of rates put A Coruna’s company at a very competitive levelas compared with other Spanish cities. The minimum price per m3 was0.25 pesetas, which was far below prices in other cities (see Table 1).

Additionally, in those years, a new institutional framework to regulatethe gas sector began to be implemented in Spain. During Miguel Primode Rivera’s dictatorship (1923–1930) there was a preoccupation withnationalisation and an economic policy that intended to promote thedomestic industry. He chose to ‘Spanish-ise ’ public utilities, also puttingthose services under the control of city councils. Until then, the State hadassumed responsibility for local public utilities, with municipal adminis-trations being subordinate to central authorities, so that although citycouncils continued to be in charge, they entrusted usage to an individual

0

0.05

0.10

0.15

0.20

0.25

0.30

1913

1915

1917

1919

1921

1923

1925

1927

1929

1931

1933

1935

1937

1939

pese

tas/

kWh

0

0.05

0.10

0.15

0.20

0.25

pese

tas/

m3

Electric power pesetas/kWh Gas lighting pesetas/m3

F IGURE 5. Nominal wholesale prices of energy in Spain, 1913–1939, in 1913 pesetas.

(Source: Ministerio de Trabajo, Direccion General de Estadıstica, Boletın de Estadıstica.

Numero extraordinario. Precios al por mayor y numeros ındices 1913 a 1941, Madrid, 1942,

128–43.)


140

or a company who bore the economic risks.108 Conversely, the new regimesought to establish new rules, granting privileges to the city councils toimplement the direct management of public utilities. This was subse-quently confirmed by the Municipal Act of 1935 and the Local RegimeActs of 1945 and 1953.

The result was the first case of municipalisation (during the 1920s and1930), although it was not entirely successful, and only affected certainutilities (mainly water). In other countries, municipalisation came aboutbecause of complaints about the high price and poor quality of gas sup-plied by the companies.109 Nevertheless, the financial position of Spanishcouncils meant that they had to leave the management of urban infra-structures in private hands, as had previously occurred.

Finally, the economic crisis of the 1930s (and regional, local and ex-ternal factors linked to the recession) began to affect gas in Galicia.110 Lessbusiness meant a smaller urban market, and hence diminishing demandfor energy.111 In Spain, as in other countries, there was new specialis-ation112 (albeit belated, as this reorientation of the applications of gas hadbeen going on in Europe since the late nineteenth century).113 Gas had tomake inroads into domestic cooking and heating, so the gas companiesinitiated several strategies for extending the benefits of gas to promote itsuse among domestic users. In A Coruna, coal gas was at that time mostly

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1927

1928

1929

1930

1931

1932

1933

1934

1935

1936

1937

1938

Ann

ual p

rodu

ctio

n in

193

5 pe

seta

s

Value production Vigo Value production A CoruñaValue production gas Vigo Value production gas A Coruña

F IGURE 6. Total annual value of plant production of A Coruna and Vigo, in 1935 pesetas

(1927–1938). (Source: Ministerio de Industria, Estadıstica minera y metalurgica de Espana,

years 1927–1938.)


141

used in heating and cooking. Street lighting was reduced to a minimum,and its reuse in engines (formerly significant) was negligible.114 However,the problem was that these uses were even more dependent on livingstandards and, given the decline in domestic demand, the industry re-cession was widespread.115

Finally, in Vigo, on the eve of the civil war, production underwenta recovery, temporarily interrupting the downward trend that it had suf-fered in previous years, resulting in higher consumption of basic rawmaterials such as coal. Even gas output in relation to coal improved, byreplacing the elements of manufacturing and emission cited above.However, the supply of coal was a bottleneck. In Spanish cities it wasdifficult to access regular and high-quality supplies of coal and oil at lowcost. Coal mining sharply declined in the country in the 1930s, althoughthe import of coal was also subject to fluctuation resulting from outputcrises and prices in the United Kingdom and Germany.116

5. CONCLUS ION

The manner in which gas was introduced in Galicia follows a similarpattern to that of other peripheral European regions : delays, predomi-nance of foreign capital, lack of competition, reduced market size andaccessibility to coal as the key elements, as well as public lighting as theinitial driving force, and the private demand for further consolidation andexpansion.

In Galicia we have observed two different models of institutional rela-tions between city councils and the concessionaire companies. On the one

TABLE 1Gas prices in A Coruna and other Spanish cities in 1921

City

Price

(pesetas/m3) City

Price

(pesetas/m3)

Murcia 0.80 Santander 0.50

Zaragoza 0.70 Bilbao 0.45

Jerez 0.70 Madrid 0.45

Barcelona 0.55 Gijon 0.40

Cadiz 0.55 Oviedo 0.40

San Sebastian 0.55 Valencia 0.40

Seville 0.55 Vigo 0.40

Almerıa 0.50 A Coruna 0.25

Source : Fabricas Corunesas de Gas y Electricidad, S.A., year 1921, Memoria leıda en laJunta general de Accionistas celebrada el dıa 14 de marzo de 1922 (La Coruna, 1922), 12.


142

hand, the city of A Coruna learned at an early stage to impose contractualrules upon quite demanding companies. The local bourgeoisie’s extensiveexperience in the management of public utilities and services and theattractiveness of the market were favourable for the city. On the otherhand, other Galician cities, which were small, not as dynamic, and with alow potential demand for energy, had to negotiate from a weak position.This resulted in contracts that were more harmful to municipal interests.The experience gained by both parties (especially by local authorities) andthe implementation of street lighting in other cities meant that contractswere renegotiated more favourably for public interest. Whatever modelwas applied, conflict between municipalities and companies was especiallyprevalent with regard to service quality and unpaid municipal debts.

The turn of the century eventually brought with it a new competitor,electricity, which gradually replaced gas, firstly in street lighting and lateron in other uses. Initially, the gas companies tried to hinder this newtechnology, with varying degrees of resistance but to no avail. In fact, theincreasing advantages in terms of cost and quality led to gas companiesagreeing to gradually change the public lighting system, keeping its supplyfor themselves. The remaining uses were filled by the new electricitycompanies. The First World War further eroded the position of the gascompanies and, during the post-war period, the application of gas wasrelegated to domestic users, as in the rest of the world, despite a cyclicalrecovery in output and the number of customers.

ENDNOTES

1 C. J. Castaneda, Invisible fuel: manufactured and natural gas in America, 1800–2000

(New York, 1999), xvii.

2 The first company was founded during 1812 in London and, in the following years,

gas supplies were installed in all major towns and in most small city centres. See

M. E. Falkus, ‘The early development of the Britain gas industry, 1750–1815’,

Economic History Review 35, 2 (1982), 217–34, here 217; T. Robinson, ‘The revealed

preference of regulatory menus: evidence from the pre-nationalisation British gas

industry’, International Review of Applied Economics 20, 2 (2006), 213–21, here 214.

3 M. E. Falkus, ‘The British gas industry before 1850’, Economic History Review 20,

3 (1967), 494–508, here 494.

4 O. Hyldtoft, ‘Making gas: the establishment of the Nordic gas systems, 1800–1870’, in

A. Kaijser and M. Hedin eds.,Nordic energy systems: historical perspectives and current

issues (Canton, 1995), 77.

5 The first gas street lights were installed in Paris in 1816; K. Chatzis and O. Coutard,

‘Water and gas: early developments in the utility networks of Paris ’, Journal of Urban

Technology 12 (2005), 8. The situation was similar in the United States, where manu-

factured gas was installed in Baltimore during the same year. The use of gas underwent

outstanding growth particularly in the 1840s and 1850s; see M. H. Rose, Cities of light


143

and heat. Domesticating gas and electricity in urban America (University Park, PA,

1995), 21; and C. Castaneda, ‘Manufactured and natural gas industry’, in R. Whaples

ed., EH.Net Encyclopedia, February 2010, http://eh.net/encyclopedia/article/castaneda.

gas.industry.us

6 M. Arroyo, ‘Gas en todos los pisos. El largo proceso hacia la generalizacion del con-

sumo domestico del gas’, Scripta Nova. Revista Electronica de Geografıa y Ciencias

Sociales 146, 135 (2003), http://www.ub.es/geocrit/sn/sn-146(135).htm

7 C. Ward, A history of the Hull gas supply industry (Hull, 1988), 7.

8 D. Matthews, ‘Laissez-faire and the London gas industry in the nineteenth century.

Another look’, Economic History Review 39, 2 (1986), 244–63, here 246; J. Foreman-

Peck and R. Millward, Public and private ownership of British industry, 1820–1990

(Oxford, 1994), 130.

9 J. F. Wilson, ‘Ownership, management and strategy in early north-west gas companies,

1815–1830’, Business History 33, 2 (1991), 203–21.

10 G. Manners, ‘Recent changes in the British gas industry’, Transactions and Papers of

the Institute of British Geographers 26 (1959), 153–68, here 153.

11 Castaneda, Invisible fuel, xvii.

12 M. Arroyo, ‘Technical networks and urban territory: a survey of the literature in

Spain’, in T. J. Misa and M. Hard eds., The urban machine: recent literature

on European Cities in the 20th century (2003), 5, http://www.tc.umn.edu/~tmisa/toe20/

urban-machine/complete-pwd.pdf

13 F. Goodall, ‘Appliance trading activities of British gas utilities, 1875–1935’, Economic

History Review 46, 3 (1993), 543–57, here 553.

14 Galicia is situated in north-west Spain. It was an agrarian region with rugged relief and

Atlantic weather with most of its population spread out living in very small towns in the

countryside. Most of its gross domestic product (GDP) came from agriculture, live-

stock and fishing, with a low level of industrialisation and urbanisation. There was a

high stream of migration towards Argentina and Cuba.

15 Peripheral regions are those with a lower level of economic development (income per

capita, industrialisation and urbanisation) and a dependency on capital and technology

from the core regions.

16 A. Kahn, The economics of regulation: principles and institutions (Boston, 1988);

R. Millward, ‘European governments and the infrastructure industries, c. 1840–1914’,

European Review of Economic History 8, 1 (2004), 3–28.

17 M. Sing, ‘Are combination gas and electric utilities multiproduct natural monopolies? ’,

Review of Economics and Statistics 69, 3 (1987), 392–8.

18 R. Millward, ‘The market behaviour of local utilities in pre-World War I Britain: the

case of gas’, Economic History Review 44, 1 (1991), 102–27.

19 C. Winston and S. Peltzman, Deregulation of network industries (Washington, DC,

2000); J. E. Kwoka, ‘The role of competition in natural monopoly: costs, public

ownership, and regulation’, Review of Industrial Organization 29, 1–2 (2006), 127–47;

P. L. Joskow, ‘Regulation of natural monopolies ’, in A. M. Polinsky and S. Shavell

eds., Handbook of law and economics (London, 2007), 1227–48.

20 Goodall, ‘Appliance trading activities’.

21 Arroyo, ‘Gas en todos los pisos ’.

22 J.-P. Williot and S. Paquier, ‘Strategies entrepreneuriales et evolution des marches des

annees 1840 aux annees 1930’, in S. Paquier and J.-P. Williot eds., L’industrie du gaz

en Europe aux XIXe et XXe siecles. L’innovation entre marches prives et collectivites

publiques (Brussels, 2005), 53–64.

23 T. I. Williams, A history of the British gas industry (New York, 1981).


144

24 J.-P. Williot, ‘La diffusion de la technologie gaziere francaise dans le bassin medi-

terraneen: de la construction des usines a gaz a la mise en place des reseaux de

gaz naturel (annees 1840–1980)’, in M. Merger ed., Transferts de technologies en

Mediterranee (Paris, 2006), 207–19.

25 Hyldtoft, ‘Making gas’.

26 A. Giuntini, ‘Il gas in Italia fra industria e servizio urbano dall’avvento dell’elettricita

alla scoperta del metano’, in G. Bigatti, A. Giuntini, A. Mantegazza and C. Rotondi

eds., L’acqua e il gas in Italia. La storia dei servizi a rete, delle aziende pubbliche e della

Federgasacqua (Milan, 1997), 165–97.

27 The socio-economic variables (industrial development and income level) seemed to

have a decisive role, as can be seen in the case of Italy where gas began to spread

throughout the north, even in interior cities, which were more developed and close to

France. See Giuntini, ‘Il gas in Italia’, 170–1.

28 C. Sudria, ‘Notas sobre la implantacion y el desarrollo de la industria del gas en

Espana, 1843–1901’, Revista de Historia Economica 1, 2 (1983), 97–118.

29 Falkus, ‘The British gas industry’.

30 In France virtually all cities with over 8,000 people had this service; see J. P. Williot,

‘De la naissance des compagnies a la constitution des groupes gaziers en France (annees

1820–1930)’, in Paquier and Williot, L’industrie du gaz en Europe, 147–79.

31 Libro de Sesiones del Ayuntamiento de A Coruna, 29/11/1855, 145.

32 Archivo de la Fundacion Gas Natural, caja 70, Informe de Prouvat de Guery,

Barcelona, 7/9/1883.

33 Libro de Sesiones del Ayuntamiento de Vigo, 24/8/1884, 115.

34 Archivo Historico de la Universidad de Santiago de Compostela (hereafter AHUSC),

Fondo Municipal, Libro 1386, Alumbrado publico, 1871–1881, f. 151r.

35 C. O’Sullivan, The gasmakers. Historical perspectives on the Irish gas industry (Dublin,

1987), 33.

36 M. W. H. Peebles, Evolution of the gas industry (London, 1980), 115.

37 N. L. Madureira, A historia da energia: Portugal 1890–1980 (Lisbon, 2005), 176.

38 The lack of business archival records hampers investigation of the characteristics of

these firms in any depth.

39 Sociedad para el alumbrado de gas de la ciudad de La Coruna, Lyon 1853.

40 Archivo General de Protocolos de A Coruna, Escribano Manuel de Agra, Protocolo

nx 9362, ano 1854, ff. 67–80. This implementation in A Coruna benefited from

the presence of a large French colony of merchants and artisans in the city from the

mid-eighteenth century onwards. The Lyon firm was small and formed by merchants,

probably silk manufacturers; J. M. Giraud, Gaz et electricite a Lyon (1820–1946), des

origines a la nationalisation (Lyon, 1992), doctoral thesis. It was established as a limited

partnership, becoming a public limited company in the early 1880s, relatively late when

compared with other gas companies in Lyon. The management was unstable during the

early decades (as in Santiago), but it consolidated in the 1880s when this task was

allocated to Francois Saunier, an engineer who also held French vice consul in

A Coruna. The company also started employing Spanish technical staff (engineers), in

response to the rise of Spanish nationalism. Since the late nineteenth century, the firm

came to depend on a Lyonnais powerful business group, the Societe de Gaz et Electricite

du Sudest.

41 Libro de Sesiones del Ayuntamiento de Vigo, 9/10/1882.

42 AHUSC, Fondo Municipal, Libro 1386, Alumbrado publico, 1871–1881, f. 1r.

43 Archivo de la Fundacion Gas Natural, caja 115, convenio Catalana-General de

Espana, 1/12/1883.


145

44 Biblioteca General de la Universidad de Santiago de Compostela, fondo Espino, leg.

Fabrica de gas de Santiago.

45 M. Arroyo, ‘Actitudes empresariales y estructura industrial. El gas de Malaga,

1854–1929’, Scripta Nova. Revista Electronica de Geografıa y Ciencias Sociales X, 215

(2006), http://www.ub.es/geocrit/sn/sn-215.htm

46 A. Fernandez, ‘Cambio tecnologico y transformaciones empresariales: gas y elec-

tricidad en Bilbao y en Burdeos (ca. 1880–ca. 1920)’, Historia Contemporanea 25

(2001), 319–42; Williot, ‘De la naissance des compagnies’, 147–79.

47 Archivo Municipal de A Coruna (hereafter AMC), caja 2759, expte. 1853; AHUSC,

FondoMunicipal, Libro 1386, Alumbrado publico, 1871–1881, ff. 49r–65bisv; Archivo

de la Fundacion Gas Natural, Caja 115, Dictamen sobre la rescision del contrato, 9/10/

1890; Libro de Sesiones del Ayuntamiento de Vigo, 22/11/1882.

48 For example, the duration of the concession was 25 years in A Coruna and 45 years in

Santiago de Compostela.

49 Arroyo, ‘Actitudes empresariales’.

50 Libros de Sesiones de los Ayuntamientos de A Coruna, Santiago, Ferrol y Vigo; AMC,

caja 2761, expte. 4/1869; AHUSC, Fondo Municipal, Libro 1386; Alumbrado publico,

ff. 169r–366r; Archivo de la Fundacion Gas Natural, caja 115, Proyecto municipal de

reforma del contrato, 11/5/1889.

51 For instance, the death of Luis Laty, the president of the company in A Coruna; see

Libro de Sesiones del Ayuntamiento de A Coruna, 9/10/1855, 126.

52 There were disagreements on the length of new concessions, the minimum number of

annual lighting hours, prices and quality of service. Some of these conflicts lasted sev-

eral years.

53 In general, the contract specifications used to consider some kind of penalty for such

behaviour, although the casuistry was very heterogeneous.

54 In Ferrol it was 42 per cent of the turnover.

55 In Ferrol municipal debts only accounted for 3.4 per cent of municipal turnover

(1884–1890), well below the Councils of A. Coruna (47.1 per cent for 1868–1871) and

Santiago (19 per cent for 1875–1878). In Vigo municipal arrears were small.

56 Peebles, Evolution of the gas industry, 23.

57 D. R. Shiman, ‘Explaining the collapse of the British electrical supply industry in the

1880s: gas versus electric lighting prices’, Business and Economic History 22, 1 (1993),

318–27.

58 Foreman-Peck and Millward, Public and private ownership, 202.

59 P. W. MacAvoy, The natural gas market: sixty years of regulation and deregulation

(New Haven, 2001), 10.

60 The most important developments were the Auer incandescent gas mantle (1882), the

Welsbach lamp, the electricity applied to stoking machinery, the use of the inclined

retorts and of new combustibles (coke), and the so-called ‘water gas’, which was

produced by passing steam through hot coke, etc. See D. Matthews, ‘The technical

transformation of the late nineteenth-century gas industry’, Journal of Economic

History 47, 4 (1987), 967–80.

61 M. H. Rose, ‘Urban gas and electric systems and social change, 1900–1940’, in

J. A. Tarr and G. Dupuy eds., Technology and the rise of the networked city in Europe

and America (Philadelphia, 1988), 229–45; Wilson, ‘Ownership, management and

strategy’.

62 Castaneda, Invisible fuel.

63 C. Sudria, ‘Atraso economico y resistencia a la innovacion: el caso del gas natural en

Espana’, Documents d’Analisi Geografica 5 (1984), 75–96.


146

64 Ibid., 88.

65 D. Garcıa de la Fuente, La historia del gas en Granada: del gas Lebon al gas natural

(Seville, 1998).

66 Castaneda, Invisible fuel, 69.

67 That is, barely 1.6 per cent of Spanish production. In contrast, the population of

Galicia in 1900 represented 10.64 per cent of all Spaniards, but in 1930 this had declined

to 9.42 per cent. Sudria, ‘Notas sobre la implantacion’.

68 As inferred from documentation in municipal records.

69 AMC, Actas Municipales del Ayuntamiento de La Coruna, 1889.

70 AMC, Actas Municipales del Ayuntamiento de La Coruna, 2/4/1900, 101.

71 AMC, Expedientes y comunicaciones de ordenes de ejecucion de obras y de encendido y

apagado del alumbrado public, Alumbrado publico, Unidad 2.763.

72 The Companıa Popular de Gas y Electricidad was founded in Gijon, and purchased

other electricity companies in this northern Spanish city, such as the Electra Industrial

de Gijon (1906), Companıa Electrica Peninsular, Fabrica de Electricidad de Illas and

Companıa Popular de Aviles ; see J. Santana, Asturias, una historia del gas de alumbrado

(Oviedo, 1989), 206.

73 AHUSC, A.M. Alumbrado publico, libro 1387.

74 M. Arroyo, El gas en Ferrol (1883–1898). Condiciones tecnicas, iniciativas economicas e

intereses sociales (Barcelona, 2006), 115.

75 Ayuntamiento del Ferrol, Expediente instruido para la rescision del contrato de alumbrado

publico por gas otorgado en 10 de enero de 1882 por faltas de cumplimiento de la

‘Sociedad Catalana para el alumbrado por gas ’ a las condiciones estipuladas (El Ferrol,

1898), 3, 17.

76 A. Gonzalez Garcıa, El gas en Sevilla: 100 anos de historia, 1846–1945 (Seville,

1981), 84.

77 D. Garcıa de la Fuente, Del gas del alumbrado al gas natural en Castellon de la Plana,

1870–1995 (Valencia, 1996), 98.

78 AMC, Actas Municipales del Ayuntamiento de La Coruna, 9/4/1880, 42.

79 AMC, Expedientes de contratacion de servicio. Alumbrado publico, Unidad 2.762 and

2.764, Ayuntamiento de La Coruna.

80 M. E. Falkus, ‘The development of municipal trading in the nineteenth century’,

Business History 19, 3 (1977), 134–61; R. Millward, ‘The market behaviour’, 99.

81 P. Dogliani, ‘Il dibattito sulla municipalizzazione in Europa dall’inizio del novecento

alla prima guerra mondiale’, in F. Berselli, F. Della Peruta and F. Varni eds., La

municipalizzazione nell’area padana. Storia ed esperienze a confronto (Milan, 1998),

222–56.

82 The pioneering countries in the municipalisation of gas were Britain, Austria-Hungary

and Italy, although its magnitude was relatively small, being more relevant in Germany,

Scandinavian countries and Switzerland. See J. P. Williot and S. Paquier, ‘Origine et

diffusion d’une technologie nouvelle au XIXe siecle ’, in Paquier and Williot, L’industrie

du gaz en Europe, 21–51.

83 J. Gascon, Municipalizacion de los servicios publicos (Madrid, 1904).

84 In 1900, A Coruna was the largest city of the region, with 43,971 inhabitants. It was

mere nineteenth in the ranking of Spanish provincial capitals. Lugo, Ferrol, Santiago,

Vigo and Pontevedra had approximately 20,000–25,000 inhabitants.

85 The most significant examples were the following: (a) Barcelona, a city where the

position of the gas company was very solid, but the city council planned municipali-

sation in 1911. See M. Arroyo, La industria del gas en Barcelona (1841–1933).

Innovacion tecnologica, articulacion del territorio y conflicto de intereses (Barcelona,


147

1996), 367; (b) Madrid, whose service was seized between 1917 and 1921. See

Ma. C. Simon, El gas y los madrilenos (Madrid, 1989); (c) Valencia, where the attempt

of municipalisation in 1905 was not successful because of pressure from the central

government; (d) special cases were San Sebastian, whose service was municipalised in

1889. See C. Larrinaga, ‘Los orıgenes del gas en San Sebastian (1860–1871). El proceso

administrativo’, Mundaiz 47 (1994), 97–118; or (e) Bilbao, where the factory and

gas distribution service were municipalised in 1885, although in the early twentieth

century, coinciding with a decline in gas consumption, the city council decided to ‘de-

municipalise ’ the factory. However, it could not be privatised, and for that reason a

‘mixed’ board of directors was created, responsible for the management of the service,

applying private company methods. This set-up did not become effective until 1914,

after lengthy disputes. See Fernandez, ‘Cambio tecnologico’.

86 AHUSC, Fondo Municipal, Libro 1387, Alumbrado publico, ff. 529r–529v.

87 AHUSC, Fondo Municipal, Libro 2044, Alumbrado publico, 1903, f. 3.

88 Libros de Sesiones del Ayuntamiento de Vigo (Vigo City Council Meetings).

89 Ibid., 21/3/1907, 52.

90 Ibid., 1/2/1906, 28; 7/9/1907, 171; 6/2/1909, 18.


92 M. Fernandez Paradas, ‘Empresas y servicio de alumbrado publico por gas en

Espana (1842–1935)’, TST. Transportes, Servicios y Telecomunicaciones 16 (2009),

108–31.

93 Sudria, ‘Atraso economico y resistencia’, 88–9.

94 According to Arroyo, Barcelona was probably the only Spanish city that saw its gas

network developed in a similar manner to how the networks of other European cities

were built, because it had two major segments of consumption (lighting and the energy

supply for industrial engines), as well as some local gas entrepreneurs who, in general,

showed outstanding business acumen. See Arroyo, ‘Actitudes empresariales’.

95 Garcıa de la Fuente, Del gas del alumbrado, 139.

96 P. Fabregas, Gas Cadiz, 1845–1969 (Barcelona, 1989), 39–40.

97 Ministerio de Economıa Nacional, Apuntes para el momento de la industria espanola de

1930. Coruna (Madrid, c. 1932), 413.

98 See the 1917 Statistical Yearbook for Spain; Anuario Estadıstico de Espana (Madrid,

1917).

99 Instituto de Reformas Sociales, Resumen de las informaciones de los inspectores del

trabajo acerca de las consecuencias sufridas por las industrias en Espana con motivo del

actual estado de guerra (Madrid, 1914); Instituto de Reformas Sociales, Coste de la vida

del obrero. Estadıstica de los precios de los artıculos de primera necesidad en toda Espana,

desde 1909 a 1915 (Madrid, 1916), 101.

100 Coal was a very important factor of cost for the gas industry. R.Millward and R.Ward,

‘The costs of public and private gas enterprises in late 19th century Britain’, Oxford

Economic Papers New Series 39, 4 (1987), 719–37. In Galicia, its shortage forced the

industry to obtain it from abroad via imports (mostly from Britain) or by coastal

shipping from Asturias.

101 Fabricas Corunesas de Gas y Electricidad, S.A. (hereafter FCGE), year 1920,Memoria

leıda en la Junta general de Accionistas celebrada el dıa 14 de marzo de 1921 (La Coruna,

1921).

102 Cooperativa Electrica Corunesa, S.A., year 1919, Memoria (La Coruna, 1920), 17.


104 Goodall, ‘Appliance trading activities’, 553.

105 Sudria, ‘Atraso economico y resistencia’, 88.


148

106 S. Coll and C. Sudria, El carbon en Espana 1770–1961. Una historia economica (Madrid,

1987).

107 FCGE, year 1921, Memoria leıda en la Junta general de Accionistas celebrada el dıa 14

de marzo de 1922 (La Coruna, 1922), 9.

108 Arroyo, La industria del gas, 366.

109 M. Hietala, Services and urbanization at the turn of the century. The diffusion of in-

novations (Helsinki, 1987), 223.

110 J. Miras, Continuidad y cambio en la Espana urbana en el perıodo de entreguerras.

Analisis de una ciudad espanola (A Coruna, 2007), 140.

111 FCGE, year 1933, Memoria redactada por el Presidente de esta sociedad que presenta el

Consejo de Gobierno a la Junta General de Accionistas que ha de celebrarse el dıa 26 de

marzo de 1934 (La Coruna, 1934), 12.

112 Sudria, ‘Atraso economico y resistencia’, 89.

113 Williot and Paquier, ‘Strategies entrepreneuriales’.

114 Ministerio de Economıa Nacional, Apuntes, 413.

115 FCGE, year 1935, Memoria redactada por el Presidente de esta sociedad que presenta el

Consejo de Gobierno a la Junta General de Accionistas que ha de celebrarse el dıa 30 de

marzo de 1936 (La Coruna, 1936), 10.

116 Sociedad General Gallega de Electricidad, S.A., Memoria presentada por el Consejo de

Administracion a la Junta General de Accionistas. Ejercicio de 1935 (La Coruna).

FRENCH AND GERMAN ABSTRACTS

La ville comme affaire commerciale : gaz et compagnies dans une region espagnole,la Galice, 1850–1936

L’histoire du gaz de ville correspond a un cas unique dans le developpement desservices publics en milieu urbain. En effet, le gaz a fait l’objet de la premiereinfrastructure en reseau mise place dans des villes. En Espagne, son histoire estdiscontinue car les reseaux ont ete demanteles dans les annees 1940 et 1950. Le butde l’article est de retracer les etapes du developpement du reseau gazier dans uneregion espagnole ou les compagnies du gaz ont pris precocement la forme d’en-treprises modernes. Elles contribuerent de facon significative au dynamisme desmarches financiers locaux, a la fois en termes de configuration d’entreprise, dediffusion technologique et de gestion innovante. Cependant, le developpement del’industrie gaziere resta soumis aux conditions locales de l’offre et de la demande,aux relations conflictuelles avec des administrations locales et souffrit de la con-currence de l’electricite.

Die Stadt als Unternehmen. Gas und Unternehmen in einer spanischen Region:Galizien 1850–1936

Die Gasversorgung stellt einen einzigartigen Fall offentlicher Dienstleistungendar, da sie das erste infrastrukturelle stadtische Netzwerk bildet, das in Stadteneingerichtet wurde. In Spanien brach diese Entwicklung ab, als in den 1940er und50er Jahren die Netzwerke aufgelost wurden. Dieser Beitrag setzt sich zum Ziel,


149

die Entwicklung der Gasversorgung in einer spanischen Region nachzuzeichnen,in der die Gasgesellschaften eines der ersten Beispiele fur moderne Unternehmendarstellten. Auf den Gebieten der Unternehmensstrukturierung, der technolo-gischen Diffusion, des innovativen Managements und der Dynamisierungortlicher Kapitalmarkte leisteten sie bemerkenswerte Beitrage. Die Entwicklungder Gasindustrie wurde jedoch auch durch die lokalen Angebots- undNachfragebedingungen, die zwiespaltigen Beziehungen zur Lokalverwaltung unddie zunehmende Konkurrenz der Elektrizitatsbetriebe bestimmt.


150

The City as a Business: Gas and Business in the Spanish region of Galicia, 1850-1936

Documents

Transcript of The City as a Business: Gas and Business in the Spanish region of Galicia, 1850-1936